Hero Honda, Bajaj Auto cut price of entry-level models

18 October, 2007

India’s top two-wheeler makers, Hero Honda and Bajaj Auto, have slashed prices on its entry-level models, this festival season.

While Hero Honda started the price war announcing a discount of Rs 2,020 on its entry-level bike CD Deluxe, Bajaj Auto went a step ahead by reducing as much as Rs 4,000 in the price of its 100 cc bike Platina. The price cuts are seen as the companies’ way of ushering in the festival season, and thereby luring buyers to their showrooms.

According to a report, Hero Honda has gone for the price cut in celebration of the sales of 20 million motorcycles in the country. The company’s CD Deluxe used to cost around Rs 35,000-36,000 before the price cut. Meanwhile, Bajaj Auto’s Platina would now be available for Rs 29,990 as against the existing Rs33,990. The companies have added that the offers are for a limited period of the festival season.

It may be noted that two-wheeler sales had declined by 13.2 per cent in September 2007 to 679,766 units, while motorcycle sales fell by 18.4 per cent to 548,816 units.

Meanwhile, a related report said that TVS Motors, the third largest player in the segment, has not thought of a price cut on its entry level Star range, which is currently priced around Rs 36,000-38,000.

The latest price war in the motorcycle industry comes in the backdrop of lower sales volume this year on the back of the series of monetary tightening steps taken by the Reserve Bank of India (RBI) to contain inflation.